HUMANA INC

Previous wording

As a result of these initiatives, we recorded charges of $98 million and $24 million for the three months ended March 31, 2026 and 2025, respectively, within operating costs in the consolidated statements of income. The charges primarily relate to external consulting spend, severance and other employee related charges in connection with workforce optimization, and asset impairments for the three months ended March 31, 2026 and 2025. We expect to incur additional charges over the course of the program.

Current wording

As a result of these initiatives, we recorded charges of $56 million and $154 million for the three and six months ended June 30, 2026, respectively, and $29 million and $53 million for the three and six months ended June 30, 2025, respectively, within operating costs in the consolidated statements of income. The charges primarily relate to severance and associate exit costs, asset impairments, and external consulting expenses incurred to execute the program. We expect to incur additional charges over the course of the program.

Previous wording

•Our strategy is to offer our members affordable health care combined with a positive consumer experience in growing markets. At the core of this strategy is our integrated care delivery model, which unites quality care, high member engagement, and sophisticated data analytics. Our approach to primary, physician-directed care for our members aims to provide quality care that is consistent, integrated, cost-effective, and member-focused, provided by both employed physicians and physicians with network contract arrangements. The model is designed to improve health outcomes and affordability for individuals and for the health system as a whole, while offering our members a simple, seamless healthcare experience. We believe this strategy is positioning us for long-term growth in both membership and earnings. We offer providers a continuum of opportunities to increase the integration of care and offer assistance to providers in transitioning from a fee-for-service to a value-based arrangement. These include performance bonuses, shared savings and shared risk relationships. At March 31, 2026, approximately 4,088,800 members, or 64%, of our individual Medicare Advantage members were in value-based relationships under our integrated care delivery model, as compared to 3,501,700 members, or 67%, at March 31, 2025.

Current wording

•Our strategy is to offer our members affordable health care combined with a positive consumer experience in growing markets. At the core of this strategy is our integrated care delivery model, which unites quality care, high member engagement, and sophisticated data analytics. Our approach to primary, physician-directed care for our members aims to provide quality care that is consistent, integrated, cost-effective, and member-focused, provided by both employed physicians and physicians with network contract arrangements. The model is designed to improve health outcomes and affordability for individuals and for the health system as a whole, while offering our members a simple, seamless healthcare experience. We believe this strategy is positioning us for long-term growth in both membership and earnings. We offer providers a continuum of opportunities to increase the integration of care and offer assistance to providers in transitioning from a fee-for-service to a value-based arrangement. These include performance bonuses, shared savings and shared risk relationships. At June 30, 2026, approximately 4,118,700 members, or 64%, of our individual Medicare Advantage members were in value-based relationships under our integrated care delivery model, as compared to 3,542,300 members, or 68%, at June 30, 2025.

Previous wording

•Net income attributable to Humana was $1.19 billion, or $9.83 per diluted common share, and $1.24 billion, or $10.30 per diluted common share, for the three months ended March 31, 2026 and 2025, respectively. These comparisons were impacted by put/call valuation adjustments associated with non-consolidating minority interest investments and charges associated with value creation initiatives. The impact of these adjustments to our consolidated income before income taxes and equity in net losses and diluted earnings per common share was as follows for the 2026 and 2025 quarter:

Current wording

•Net income attributable to Humana was $694 million, or $5.73 per diluted common share, and $545 million, or $4.51 per diluted common share, for the three months ended June 30, 2026 and 2025, respectively. Net income attributable to Humana was $1.9 billion, or $15.55 per diluted common share, and $1.8 billion, or $14.81 per diluted common share, for the six months ended June 30, 2026 and 2025, respectively. These comparisons were impacted by put/call valuation adjustments associated with non-consolidating minority interest investments, impairment charges and charges associated with value creation initiatives. The impact of these adjustments to our consolidated income before income taxes and equity in net losses and diluted earnings per common share was as follows for the 2026 and 2025 quarter and period:

Previous wording

The following discussion primarily deals with our results of operations for the three months ended March 31, 2026, or the 2026 quarter and the three months ended March 31, 2025, or the 2025 quarter.

Current wording

The following discussion primarily deals with our results of operations for the three months ended June 30, 2026, or the 2026 quarter, the three months ended June 30, 2025, or the 2025 quarter, the six months ended June 30, 2026, or the 2026 period, and the six months ended June 30, 2025, or the 2025 period.

Previous wording

(b)Represents operating costs, excluding depreciation and amortization, as a percentage of total revenues less investment income.

Current wording

(b)Represents operating costs, excluding depreciation and amortization, as a percentage of total revenues less net investment income.

Previous wording

Consolidated premiums revenue increased $7.2 billion, or 23.6%, from $30.5 billion in the 2025 quarter to $37.7 billion in the 2026 quarter primarily reflecting membership growth across the Medicare businesses in 2026, higher per member Medicare Advantage (MA) and stand-alone PDP premiums largely driven by an increase in MA benchmark funding from the Centers for Medicare and Medicaid Services (CMS) and the increased Part D direct subsidy as a result of the Inflation Reduction Act (IRA). These factors were partially offset by the previously disclosed Bonus Year (BY) 2026 Star Ratings headwind.

Current wording

Consolidated premiums revenue increased $8.1 billion, or 26.4%, from $30.7 billion in the 2025 quarter to $38.8 billion in the 2026 quarter and increased $15.3 billion, or 25.0%, from $61.2 billion in the 2025 period to $76.5 billion in the 2026 period primarily reflecting membership growth across the Medicare businesses in 2026, higher per member Medicare Advantage (MA) and stand-alone PDP premiums largely driven by an increase in MA benchmark funding from the Centers for Medicare and Medicaid Services (CMS) and the increased Part D direct subsidy as a result of the Inflation Reduction Act (IRA). These factors were partially offset by the previously disclosed Bonus Year (BY) 2026 Star Ratings headwind.

Previous wording

Consolidated services revenue increased $0.3 billion, or 25.7%, from $1.3 billion in the 2025 quarter to $1.7 billion in the 2026 quarter primarily reflecting the increased payor-agnostic client base across the CenterWell platform partially offset by the final year of the phase-in of the v28 risk model revision.

Current wording

Consolidated services revenue increased $0.4 billion, or 27.1%, from $1.4 billion in the 2025 quarter to $1.8 billion in the 2026 quarter and increased $0.7 billion, or 26.4%, from $2.7 billion in the 2025 period to $3.5 billion in the 2026 period primarily reflecting the increased payor-agnostic client base across the CenterWell platform partially offset by the final year of the phase-in of the v28 risk model revision.

Previous wording

Consolidated benefits expense increased $7.2 billion, or 27.0%, from $26.5 billion in the 2025 quarter to $33.7 billion in the 2026 quarter. The consolidated benefit ratio increased 240 basis points from 87.0% for the 2025 quarter to 89.4% for the 2026 quarter primarily reflectingthe BY 2026 Star Ratings revenue headwind, the effect of the individual MA membership growth during the most recent Annual Election Period (AEP) and Open Enrollment Period (OEP) as the new members, on average, run at a higher benefit ratio as compared to retained members (excluding the impact of the BY 2026 Star Ratings headwind) andthe anticipated lower favorable prior-period medical claims reserve development in the 2026 quarter compared to the 2025 quarter. These factors were partially offset by the 2026 individual MA pricing, inclusive of the MA funding environment (excluding the BY 2026 Star Ratings headwind) combined with our ongoing clinical excellence efforts, more than offsetting the assumption of claims trend (with largely stable benefits year over year), and the benefit of our group MA recontracting efforts for the 2026 plan year.

Current wording

Consolidated benefits expense increased $7.8 billion, or 28.3%, from $27.6 billion in the 2025 quarter to $35.4 billion in the 2026 quarter and increased $15.0 billion, or 27.7%, from $54.1 billion in the 2025 period to $69.1 billion in the 2026 period. The consolidated benefit ratio increased 140 basis points from 89.7% for the 2025 quarter to 91.1% for the 2026 quarter and increased 180 basis points from 88.4% for the 2025 period to 90.2% for the 2026 period primarily reflecting the BY 2026 Star Ratings revenue headwind, the effect of the individual MA membership growth during the most recent Annual Election Period (AEP) and Open Enrollment Period (OEP) as the new members, on average, run at a higher benefit ratio as compared to retained members (excluding the impact of the BY 2026 Star Ratings headwind) and the anticipated lower favorable prior-period medical claims reserve development in 2026. These factors were partially offset by the 2026 individual MA pricing, inclusive of the MA funding environment (excluding the BY 2026 Star Ratings headwind) combined with our ongoing clinical excellence efforts, more than offsetting the assumption of claims trend (with largely stable benefits year-over-year), and the benefit of our group MA recontracting efforts for the 2026 plan year.

Previous wording

Consolidated benefits expense included $389 million of favorable prior-period medical claims reserve development in the 2026 quarter and $477 million of favorable prior-period medical claims development in the 2025 quarter. This development does not directly correspond to our operating results as a portion is attributable to provider risk-sharing arrangements, which are accounted for separately based on contractual terms.

Current wording

Consolidated benefits expense included $53 million of favorable prior-period medical claims reserve development in the 2026 quarter and $161 million of favorable prior-period medical claims development in the 2025 quarter. Consolidated benefits expense included $442 million of favorable prior-period medical claims reserve development in the 2026 period and $638 million of favorable prior-period medical claims reserve development in the 2025 period. This development does not directly correspond to our operating results as a portion is attributable to provider risk-sharing arrangements, which are accounted for separately based on contractual terms.

Previous wording

Consolidated operating costs increased $0.6 billion, or 19.1%, from $3.4 billion in the 2025 quarter to $4.0 billion in the 2026 quarter. The consolidated operating cost ratio decreased 40 basis points from 10.6% for the 2025 quarter to 10.2% for the 2026 quarter primarily reflecting operating leverage associated with increased revenues from membership growth across the Medicare businesses in 2026 combined with an improved MA benchmark funding rate and increased Part D direct subsidy resulting from the IRA, as well as the progress on our previously discussed tactical cost cutting and transformation initiatives combined with the beneficial impact of our prior value creation initiatives that have driven administrative cost efficiencies. These factors were partially offset by the impact of the previously disclosed BY 2026 Star Ratings headwind and a higher CenterWell operating cost ratio.

Current wording

Consolidated operating costs increased $0.4 billion, or 12.2%, from $3.5 billion in the 2025 quarter to $4.0 billion in the 2026 quarter and increased $1.1 billion, or 15.5%, from $6.9 billion in the 2025 period to $8.0 billion in the 2026 period. The consolidated operating cost ratio decreased 120 basis points from 11.0% for the 2025 quarter to 9.8% for the 2026 quarter and decreased 80 basis points from 10.8% for the 2025 period to 10.0% for the 2026 period primarily reflecting operating leverage associated with increased revenues from membership growth across the Medicare businesses in 2026 combined with an improved MA benchmark funding rate and increased Part D direct subsidy resulting from the IRA, as well as the progress on our previously discussed tactical cost cutting and transformation initiatives combined with the beneficial impact of our prior value creation initiatives that have driven administrative cost efficiencies. These factors were partially offset by the impact of the previously disclosed BY 2026 Star Ratings headwind, higher charges associated with our value creation initiatives and a higher CenterWell operating cost ratio during the 2026 period.

Previous wording

Depreciation and amortization decreased $20 million, or 10.9%, from $183 million in the 2025 quarter to $163 million in the 2026 quarter primarily due to decreased capital spending.

Current wording

Depreciation and amortization decreased $19 million, or 10.7%, from $178 million in the 2025 quarter to $159 million in the 2026 quarter and decreased $39 million, or 10.8%, from $361 million in the 2025 period to $322 million in the 2026 period primarily due to decreased capital spending.

Previous wording

Interest expense increased $33 million, or 20.6%, from $160 million in the 2025 quarter to $193 million in the 2026 quarter primarily due to financing costs and higher average debt balances.

Current wording

Interest expense increased $40 million, or 25.5%, from $157 million in the 2025 quarter to $197 million in the 2026 quarter and increased $73 million, or 23.0%, from $317 million in the 2025 period to $390 million in the 2026 period primarily due to financing costs, including liquidity and capital management measures for 2026, and higher average debt balances.

Previous wording

The effective income tax rate was 25.0% and 24.6% for the three months ended March 31, 2026 and 2025, respectively. The year-over-year increase in the effective income tax rate is primarily due to increased state tax expense.

Current wording

The effective income tax rate was 25.6% and 24.7% for the three months ended June 30, 2026, and 2025, respectively, and 25.2% and 24.6% for the six months ended June 30, 2026 and 2025, respectively. The 2026 quarter and period effective income tax rate increase is primarily related to state taxes.

Previous wording

Insurance segment income from operations decreased $139 million, or 8.8%, from $1.6 billion in the 2025 quarter to $1.4 billion in the 2026 quarter primarily due to the same factors impacting the Insurance segment's benefit and operating cost ratios as more fully described below.

Current wording

Insurance segment income from operations increased $54 million, or 7.0%, from $766 million in the 2025 quarter to $820 million in the 2026 quarter and decreased $0.09 billion, or 3.6%, from $2.34 billion in the 2025 period to $2.25 billion in the 2026 period primarily due to the same factors impacting the Insurance segment's benefit and operating cost ratios as more fully described below.

Previous wording

Individual Medicare Advantage membership increased 1,177,500 members, or 22.6%, from March 31, 2025 to March 31, 2026 reflecting net membership gains during the most recent AEP and OEP. Individual Medicare Advantage membership includes 945,100 D-SNP members as of March 31, 2026, a net increase of 146,000 D-SNP members, or 18.3%, from 799,100 D-SNP members as of March 31, 2025.

Current wording

Individual Medicare Advantage membership increased 1,224,400 members, or 23.4%, from June 30, 2025 to June 30, 2026 reflecting net membership gains during the most recent AEP and OEP. Individual Medicare Advantage membership includes 959,900 D-SNP members as of June 30, 2026, a net increase of 173,900 D-SNP members, or 22.1%, from 786,000 D-SNP members as of June 30, 2025.

Previous wording

Group Medicare Advantage membership increased 156,600 members, or 27.3%, from March 31, 2025 to March 31, 2026 reflecting net membership additions from the 2026 selling season.

Current wording

Group Medicare Advantage membership increased 157,200 members, or 27.6%, from June 30, 2025 to June 30, 2026 reflecting net membership additions from the 2026 selling season.

Previous wording

Medicare stand-alone PDP membership increased 1,427,500 members, or 58.7%, from March 31, 2025 to March 31, 2026 reflecting net membership additions from group MA recontracting efforts and the 2026 selling season.

Current wording

Medicare stand-alone PDP membership increased 1,519,300 members, or 62.6%, from June 30, 2025 to June 30, 2026 reflecting net membership additions from group MA recontracting efforts and the 2026 selling season.

Previous wording

State-based contracts and other membership decreased 46,800 members, or 2.9%, from March 31, 2025 to March 31, 2026 primarily reflecting shifts in other membership offset by net membership additions in state-based contracts.

Current wording

State-based contracts and other membership increased 20,300 members, or 1.3%, from June 30, 2025 to June 30, 2026 primarily reflecting net membership additions in state-based contracts offset by shifts in other membership.

Previous wording

Specialty membership increased 223,900 members, or 5%, from March 31, 2025 to March 31, 2026 primarily reflecting growth in group dental and vision products.

Current wording

Specialty membership increased 198,700 members, or 4%, from June 30, 2025 to June 30, 2026 primarily reflecting growth in group dental and vision products.

Previous wording

Insurance segment premiums revenue increased $7.2 billion, or 23.6%, from $30.5 billion in the 2025 quarter to $37.7 billion in the 2026 quarter primarily reflecting membership growth across the Medicare businesses in 2026, higher per member MA and stand-alone PDP premiums largely driven by an increase in MA benchmark funding from CMS and the increased Part D direct subsidy as a result of the IRA. These factors were partially offset by the BY 2026 Star Ratings headwind.

Current wording

Insurance segment premiums revenue increased $8.1 billion, or 26.4%, from $30.7 billion in the 2025 quarter to $38.8 billion in the 2026 quarter and increased $15.3 billion, or 25.0%, from $61.2 billion in the 2025 period to $76.5 billion in the 2026 period primarily reflecting membership growth across the Medicare businesses in 2026, higher per member MA and stand-alone PDP premiums largely driven by an increase in MA benchmark funding from CMS and the increased Part D direct subsidy as a result of the IRA. These factors were partially offset by the BY 2026 Star Ratings headwind.

Previous wording

The Insurance segment benefit ratio increased 200 basis points from 87.4% for the 2025 quarter to 89.4% for the 2026 quarter primarily reflectingthe BY 2026 Star Ratings revenue headwind, the effect of the individual MA membership growth during the most recent AEP and OEP as the new members, on average, run at a higher benefit ratio as compared to retained members (excluding the impact of the BY 2026 Star Ratings headwind) and the anticipated lower favorable prior-period medical claims reserve development in the 2026 quarter compared to the 2025 quarter. These factors were partially offset by the 2026 individual MA pricing, inclusive of the MA funding environment (excluding the BY 2026 Star Ratings headwind) combined with our ongoing clinical excellence efforts, more than offsetting the assumption of claims trend (with largely stable benefits year over year), and the benefit of our group Medicare Advantage recontracting efforts for the 2026 plan year.

Current wording

The Insurance segment benefit ratio increased 130 basis points from 89.9% for the 2025 quarter to 91.2% for the 2026 quarter and increased 160 basis points from 88.7% for the 2025 period to 90.3% for the 2026 period primarily reflecting the BY 2026 Star Ratings revenue headwind, the effect of the individual MA membership growth during the most recent AEP and OEP as the new members, on average, run at a higher benefit ratio as compared to retained members (excluding the impact of the BY 2026 Star Ratings headwind) and the anticipated lower favorable prior-period medical claims reserve development in 2026. These factors were partially offset by the 2026 individual MA pricing, inclusive of the MA funding environment (excluding the BY 2026 Star Ratings headwind) combined with our ongoing clinical excellence efforts, more than offsetting the assumption of claims trend (with largely stable benefits year-over-year), and the benefit of our group Medicare Advantage recontracting efforts for the 2026 plan year.

Previous wording

The Insurance segment operating cost ratio decreased 90 basis points from 8.2% for the 2025 quarter to 7.3% for the 2026 quarter primarily reflecting operating leverage associated with increased revenues from membership growth across the Medicare businesses in 2026 combined with an improved MA benchmark funding rate and increased Part D direct subsidy resulting from the IRA, as well as the progress on our previously discussed tactical cost cutting and transformation initiatives combined with the beneficial impact of prior value creation initiatives that have driven administrative cost efficiencies. These factors were partially offset by the impact of the previously disclosed BY 2026 Star Ratings headwind.

Current wording

The Insurance segment operating cost ratio decreased 120 basis points from 8.3% for the 2025 quarter to 7.1% for the 2026 quarter and decreased 110 basis points from 8.3% for the 2025 period to 7.2% for the 2026 period primarily reflecting operating leverage associated with increased revenues from membership growth across the Medicare businesses in 2026 combined with an improved MA benchmark funding rate and increased Part D direct subsidy resulting from the IRA, as well as the progress on our previously discussed tactical cost cutting and transformation initiatives combined with the beneficial impact of prior value creation initiatives that have driven administrative cost efficiencies. These factors were partially offset by the impact of the previously disclosed BY 2026 Star Ratings headwind.

Previous wording

CenterWell income from operations decreased $103 million, or 26.3%, from $392 million in the 2025 quarter to $289 million in the 2026 quarter primarily due to the same factors impacting the CenterWell segment's revenue and operating cost ratio as more fully described below.

Current wording

CenterWell income from operations increased $122 million, or 35.5%, from $344 million in the 2025 quarter to $466 million in the 2026 quarter and increased $19 million, or 2.6%, from $736 million in the 2025 period to $755 million in the 2026 period primarily due to the same factors impacting the CenterWell segment's revenue and operating cost ratio as more fully described below.

Previous wording

CenterWell external services revenue increased $0.3 billion, or 32.0%, from $1.1 billion in the 2025 quarter to $1.4 billion in the 2026 quarter primarily reflecting the continued expansion of our payor-agnostic client base, primarily associated with the primary care business as a result of recent acquisitions, partially offset by the final year of the phase-in of the v28 risk model revision.

Current wording

CenterWell external services revenue increased $0.4 billion, or 32.4%, from $1.2 billion in the 2025 quarter to $1.6 billion in the 2026 quarter and increased $0.7 billion, or 32.2%, from $2.3 billion in the 2025 period to $3.0 billion in the 2026 period primarily reflecting the continued expansion of our payor-agnostic client base, primarily associated with the primary care business as a result of recent acquisitions, partially offset by the final year of the phase-in of the v28 risk model revision.

Previous wording

CenterWell intersegment revenues increased $0.7 billion, or 16.4%, from $4.0 billion in the 2025 quarter to $4.7 billion in the 2026 quarter primarily due to higher revenues associated with growth in each of the CenterWell business lines resulting from increased Medicare membership in 2026.

Current wording

CenterWell intersegment revenues increased $0.9 billion, or 19.9%, from $4.3 billion in the 2025 quarter to $5.2 billion in the 2026 quarter and increased $1.5 billion, or 18.3%, from $8.4 billion in the 2025 period to $9.9 billion in the 2026 period primarily due to higher revenues associated with growth in each of the CenterWell business lines resulting from increased Medicare membership in 2026.

Previous wording

The CenterWell segment operating cost ratio increased 340 basis points from 91.1% for the 2025 quarter to 94.5% for the 2026 quarter primarily reflecting thefinal year of the phase-in of the v28 risk model revision, along with certain year-over-year timing impacts, the uptick of volume within CenterWell Specialty Pharmacy, which carries a higher operating cost ratio than the traditional pharmacy business, the anticipated headwind in the 2026 quarter associated with a primary care acquisition in the fourth quarter of 2025, as well as transaction and integration costs associated with the recently disclosed acquisition of MaxHealth in the 2026 quarter. These factors were partially offset by thecontinued maturation of the v28 mitigation activities within the primary care business andthe progress on our tactical cost cutting and transformation initiatives combined with the beneficial impact of prior value creation initiatives that have driven administrative cost efficiencies.

Current wording

The CenterWell segment operating cost ratio decreased 30 basis points from 92.7% for the 2025 quarter to 92.4% for the 2026 quarter primarily due to the continued maturation of the v28 mitigation activities within the primary care business and the progress on our tactical cost cutting and transformation initiatives combined with the beneficial impact of prior value creation initiatives that have driven administrative cost efficiencies. These factors were partially offset by the impact of the final year of the phase-in of the v28 risk model revision and the uptick of volume within CenterWell Specialty Pharmacy, which carries a higher operating cost ratio than the traditional pharmacy business. The CenterWell segment operating cost ratio increased 140 basis points from 92.0% for the 2025 period to 93.4% for the 2026 period primarily reflecting the net unfavorable impact of the items affecting the quarterly comparison along with the anticipated headwind in the first quarter of 2026 associated with a primary care acquisition in the fourth quarter of 2025, as well as transaction and integration costs associated with the recent acquisition of MaxHealth in the first quarter of 2026.

Previous wording

Cash and cash equivalents increased to approximately $5.0 billion at March 31, 2026 from $4.2 billion at December 31, 2025. The change in cash and cash equivalents for the three months ended March 31, 2026 and 2025 is summarized as follows:

Current wording

Cash and cash equivalents increased to approximately $6.9 billion at June 30, 2026 from $4.2 billion at December 31, 2025. The change in cash and cash equivalents for the six months ended June 30, 2026 and 2025 is summarized as follows:

Previous wording

Cash flows provided by operations of $1.3 billion in the 2026 quarter increased $0.9 billion from cash flows provided by operations of $0.3 billion in the 2025 quarter. The increase in our operating cash flows was the result of favorable working capital activity, primarily associated with an increase in the IBNR balance, modestly offset by a decline in net earnings in the 2026 quarter.

Current wording

Cash flows provided by operations of $3.2 billion in the 2026 period increased $1.6 billion from cash flows provided by operations of $1.6 billion in the 2025 period. The increase in our operating cash flows was the result of favorable working capital activity, primarily associated with an increase in the IBNR balance and the favorable timing impact of a $1.05 billion Medicaid state-directed payment that settled shortly after June 30, 2026, combined with a modest increase in earnings.

Previous wording

The detail of total net receivables at March 31, 2026 and December 31, 2025 and reconciliation to cash flow for the three months ended March 31, 2026 and 2025 was as follows:

Current wording

The detail of total net receivables at June 30, 2026 and December 31, 2025 and reconciliation to cash flow for the six months ended June 30, 2026 and 2025 was as follows:

Previous wording

The change in Medicare receivables for the 2026 quarter and 2025 quarter reflects the typical pattern caused by the timing of accruals and related collections associated with the CMS risk-adjustment model. Significant collections occur with the mid-year and final settlements with CMS in the second and third quarter.

Current wording

The change in Medicare receivables for the 2026 period and 2025 period reflects the typical pattern caused by the timing of accruals and related collections associated with the CMS risk-adjustment model. Significant collections occur with the mid-year and final settlements with CMS in the second and third quarter.

Previous wording

During the 2026 quarter, we acquired MaxHealth for cash consideration of approximately $908 million, net of cash acquired. No other businesses were acquired that individually or in the aggregate had a material impact on our results of operations, financial conditions or cash flows during the 2026 and 2025 quarters.

Current wording

During the 2026 period, we acquired MaxHealth for cash consideration of approximately $908 million, net of cash acquired. We acquired and disposed other businesses that individually or in the aggregate did not have a material impact on our results of operations, financial conditions or cash flows during the 2026 and 2025 periods.

Previous wording

Our ongoing capital expenditures primarily relate to our information technology initiatives, support of services in our primary care operations including medical and administrative facility improvements necessary for activities such as the provision of care to members, claims processing, billing and collections, wellness solutions, care coordination, regulatory compliance and customer service. Total net capital expenditures, excluding acquisitions, were $121 million in the 2026 quarter and $95 million in the 2025 quarter.

Current wording

Our ongoing capital expenditures primarily relate to our information technology initiatives, support of services in our primary care operations including medical and administrative facility improvements necessary for activities such as the provision of care to members, claims processing, billing and collections, wellness solutions, care coordination, regulatory compliance and customer service. Total net capital expenditures, excluding acquisitions, were $253 million in the 2026 period and $209 million in the 2025 period.

Previous wording

Net purchases of investment securities were $1.5 billion in the 2026 quarter and net proceeds of investment securities were $409 million in the 2025 quarter.

Current wording

Net purchases of investment securities were $1.7 billion in the 2026 period and net proceeds of investment securities were $871 million in the 2025 period.

Previous wording

Receipts from CMS associated with Medicare Part D claim subsidies for which we do not assume risk were higher than claim payments by $548 million and $75 million in the 2026 and 2025 quarters, respectively.

Current wording

Receipts from CMS associated with Medicare Part D claim subsidies for which we do not assume risk were higher than claim payments by $479 million in the 2026 period and claim payments were higher than receipts from CMS associated with Medicare Part D claim subsidies for which we do not assume risk by $482 million in the 2025 period.

Previous wording

Under our administrative services only TRICARE contracts, reimbursements from the federal government exceeded health care costs payments for which we do not assume risk by $125 million in the 2026 quarter and health care costs payments for which we do not assume risk exceeded reimbursements from the federal government by $110 million in the 2025 quarter.

Current wording

Under our administrative services only TRICARE contracts, reimbursements from the federal government exceeded health care costs payments for which we do not assume risk by $68 million in the 2026 period and health care costs payments for which we do not assume risk exceeded reimbursements from the federal government by $97 million in the 2025 period.

Previous wording

In March 2026, we entered into a Rule 10b5-1 Repurchase Plan to repurchase a portion of our $750 million aggregate principal amount of 1.350% senior notes maturing in February 2027, $600 million aggregate principal of 3.950% senior notes maturing in March 2027, $750 million aggregate principal amount of 3.700% senior notes maturing in March 2029, $500 million aggregate principal amount of 3.125% senior notes maturing in August 2029 and $750 million aggregate principal amount of 2.150% senior notes maturing in February 2032 during the period beginning on March 23, 2026 and ending on July 31, 2026. For the period ended March 31, 2026, we repurchased $10 million of the principal amount of the 1.350% senior notes maturing in February 2027 for approximately $10 million cash.

Current wording

In May 2025, we entered into a Rule 10b5-1 Repurchase Plan to repurchase a portion of our $750 million aggregate principal amount of 1.350% senior notes maturing in February 2027 and a portion of our $600 million aggregate principal amount of 3.950% senior notes maturing in March 2027 during the period beginning on May 1, 2025 and ending on August 29, 2025. For the period ended June 30, 2025, we repurchased $200 million principal amount of these senior notes for approximately $194 million cash.

Previous wording

In 2024, we entered into a securities lending program where we loan certain investment securities for short periods of time in exchange for collateral. In 2024, we also entered into an uncommitted receivables purchase facility under which certain pharmaceutical rebate receivables may be sold on a non-recourse basis to a financial institution. In the 2026 quarter net repayments from the securities lending program were $55 million. There were no repayments or proceeds from the uncommitted receivables purchase facility in the 2026 quarter. In the 2025 quarter, net proceeds from the securities lending program were $175 million and net repayments from the uncommitted receivables purchase facility were $68 million.

Current wording

Under our securities lending program, we loan certain investment securities for short periods of time in exchange for collateral. Net proceeds from the securities lending program were $64 million and $48 million in the 2026 period and 2025 period, respectively. Under the uncommitted receivables purchase facility certain pharmaceutical rebate receivables may be sold on a non-recourse basis to a financial institution. In the 2026 period there were no net repayments from the uncommitted receivables purchase facility. In the 2025 period net repayments from the uncommitted receivables purchase facility were $123 million.

Previous wording

Net proceeds from the issuance of commercial paper were $693 million in the 2026 quarter and maximum principal amount outstanding at any one time during the 2026 quarter was $2.0 billion. Net repayments from the issuance of commercial paper were $4 million in the 2025 quarter.

Current wording

Net proceeds from the issuance of commercial paper were $1.3 billion in the 2026 period and maximum principal amount outstanding at any one time during the 2026 period was $2.6 billion. Net repayments from the issuance of commercial paper were $5 million in the 2025 period.

Previous wording

We acquired common shares in connection with employee stock plans for $107 million and $9 million in the 2026 quarter and 2025 quarter, respectively.

Current wording

We repurchased common shares for $103 million and $100 million in the 2026 period and 2025 period, respectively, under share repurchase plans authorized by the Board of Directors. We also acquired common shares in connection with employee stock plans for $5 million and $9 million in the 2026 period and 2025 period, respectively.

Previous wording

We paid dividends to stockholders of $107 million and $108 million during the 2026 quarter and 2025 quarter, respectively.

Current wording

We paid dividends to stockholders of $214 million and $214 million during the 2026 period and 2025 period, respectively.